April 2009 Porker of the Month

By Marc Kilmer, Buckeye Institute Policy Analyst

Sitting in front of the “tube” is a favorite past time for some here in Ohio; and thanks to the Ohio Controlling Board, the Department of Development, and tax dollars from you, people across the country will now have one more channel to flip through. The Guardian Enterprise Group is proud to welcome Dot Two Entertainment, Inc. to Columbus, Ohio; and we are happy to award April 2009’s Porker of the Month to Mark Barbash and the Department of Development for this new television enterprise.

So what will new “family-friendly” television programming cost the taxpayers of Ohio? How about $25,000 to start. The State of Ohio Controlling Board under the recommendation of the Department of Development and Lt. Governor Lee Fischer, approved the $25,000 “Rapid Outreach Grant” to Dot Two Entertainmentfor costs associated with purchasing new equipment. In return Dot Two has promised to create and retain jobs. A key point though: a majority of the jobs retained are non-at-risk positions within the company.

It seems that by saying “new jobs” the company got another sweetheart deal: a $1.1 million loan that will also help with the purchasing of new equipment. The over one million dollar Innovation Ohio loan bears an interest rate of six percent for the next six years. Dot Two is a privately-owned company founded not even a year ago in July 2008. It is an expansion project by Guardian Studios, which produces commercials.

What exactly can you expect to see when you are flipping through the channels? Well, according to their website, www.dot2network.com, lots of movies. The new network will premiere major motion pictures like “Gridiron Gang” and “Stranger than Fiction.” So what happened to their “family-friendly” programming? A look at their website seems to hint that it may not be their top priority. Out of the 20 shows listed on their on-air schedule, only four of them are focused on children’s programming. The other 16 are themed around cooking, traveling, and home improvements. So what does the company say to all of this? Well, a call to the stations manager left us talking to his voicemail. The company who started this expansion, Guardian Enterprise Group, is based here in Columbus but was not able to provide any answers.

The justification in providing the grant and low-interest loan was easy, according to the operating request made to the controlling board; “Ohio is in competition with multiple states for this project due to attractive tax credits and rebates. State incentives are needed to keep Dot Two in Ohio and create and retain jobs.” Dot Two has not even been around for a year, so what evidence does the state have that this company will even be around to retain jobs?

Guardian Television Network brought in more than nine million dollars in revenue in 2006 and 2007 that is before selling its main broadcast license last year. Guardian operated WSFJ, Channel 51 beginning in 1975, but the company has recently sold the station to another broadcast group in the hope of “restructuring” their company. Does a company that is in the process of “restructuring” deserve taxpayers’ funds?

This new television venture will distribute their content via satellite on digital sub-channels. A main reason Guardian decided to expand in this way was to help the company “share ad revenue.” Does this mean with the birth of digital television less than 60 days away, more and more television stations will be asking for state funding in order to take advantage of more stations and more content? Hopefully this is the end of grants and loan-breaks for television stations offering programs you could get free at your local library. Until then, sit back, grab some popcorn, and enjoy your tax dollars transmitting across the screen!

Source: Buckeye Institute for Public Policy Solutions, April 26, 2009

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